Where to invest to make the most of the stamp duty holiday
Ensuring you choose the right location to purchase property is paramount to how successful your investment will be.
Weighing up the pros and cons of any location should always be your first step when purchasing property. This enables you to objectively pinpoint the most profitable locations.
Whether it is your entry to the property sector or an additional purchase to your portfolio, the location in which you purchase your property is extremely important. Buy To Let opportunities exist all across the UK but their success is dependent on location.
To maintain your economic success, you must stay ahead of the property market.
Naturally, many investors still prefer to spend their money in London. The Capital is well known for house prices continually increasing. But also, it is highly unlikely that rental income will diminish as there will always be demand for rental property in London.
Rent will be sustained here as many individuals do not have the income to get onto the property ladder initially so turn to renting from private landlords.
However, yield can be more profitable if you pick a location with higher rental demand and low house prices. A study by CIA Landlord has identified some areas outside London which are highly profitable right now thanks to the stamp duty holiday.
The stamp duty holiday states that until March 2021 home buyers can enjoy no stamp duty on homes up to the value of £500,000. For second homes or investment purchases only the 3% surcharge is payable.
Where to make the most of the stamp duty holiday according to CIA Landlord
Salford in Manchester is the most profitable Buy To Let area. Its house prices are below average at £173,311 but it also has above average rental prices at £1052 per month. The average stamp duty saving in this area is £966.
Manchester itself is also faring well thanks to the stamp duty holiday. Property is a tad more expensive here at an average cost of £193,681 but it has higher average rental prices of £1411. The stamp duty savings come in at £1374, a significant saving overall.
Leeds has been viewed as the third most profitable place for Buy To Let. Average house prices here are £217,415 and the rental prices are £1216. This leads to a large stamp duty saving of £1848.
Best BTL areas in London
Although London ranked lower on CIA’s list due to higher property prices investors should not be put off purchasing in the capital. This is because London benefits from higher rental demand.
Havering, within London, is the best place to take advantage of the stamp duty holiday. Property prices here are £395,832 and rents reach £1895 per month. This means buyers can save up to £9000 thanks to the stamp duty holiday.
Newham is also deemed a profitable spot in London. The average property here will set you back £353,705 but you will benefit from a rental income of £1531 per month. This means you can save £7735 from the stamp duty holiday.
The third best place for buy to let within London is Barking and Dagenham. Houses here are cheaper costing £302,060 on average. Rental income is around £1353. Meaning you could save up to £5103 from the stamp duty holiday.